|WHAT WE’RE READING
Stuff we read this week that made us think
Consolidation is everywhere in healthcare
A new report released this week by the anti-monopoly think tank Open Markets Institute (OMI), based on data from market research firm IBISWorld, highlights just how pervasive the problem of consolidation has become across the healthcare industry. Adding to the data already available on other segments of the economy, from airlines to cellphone providers, the OMI report shows how concentrated healthcare has become. Interestingly, the report doesn’t focus on the usual suspects—hospitals and insurers—but instead takes a broader view of the market. For example, the two largest ambulance manufacturers account for 83 percent of the market. Two firms make up 59 percent of surgical apparel manufacturing. Three firms combine for 86 percent of the IV solution industry. And on and on. It’s worth digging into the data, which OMI presents in a clever visualization tool. Industry consolidation is quickly becoming a policy flashpoint in healthcare, with the antitrust subcommittee of the Senate Judiciary Committee holding hearings on the topic this week. As former House speaker Newt Gingrich points out in a new op-ed in The Hill, some of the consolidation is a by-product of the shift away from traditional fee-for-service models and may benefit consumers in the long run. But we seem to be approaching a new era of trust-busting in America, with Presidential candidates and Federal judges taking a more jaundiced view of consolidation—and healthcare is no exception. Along with the renewed focus on the pocketbook impact of high care costs (from drug costs to “surprise billing”), the rise of anti-monopoly rhetoric may result in new constraints on the “bigger is better” mentality that’s become commonplace across healthcare. Monopolists beware.
Rethinking complex surgery for the elderly
More very old patients, in their 80s and beyond, are undergoing extensive surgeries for conditions like pancreatic cancer and aortic aneurysms. Unsurprisingly, with almost no surgery deemed too dangerous, the mortality and recovery outcomes of these patients are often much worse than those for patients a decade or two younger. A recent New York Times article describes how leaders of the American College of Surgeon’s (ACS) Coalition for Quality in Geriatric Surgery are working to create new standards to evaluate older patients for intensive surgery, and assist surgeons in advising patients and families about the associated risks. The core of the effort is ACS’s geriatric surgery verification program, which will set 30 standards for hospitals designed to meet the needs of older patients, ranging from facility modifications to improved risk assessment and adapted pain management. The program was designed to align with established quality programs in pediatric, trauma and cancer surgery. According to a lead physician, only recently have surgeons recognized the unique needs of geriatric surgery: “People understand that children are different from adults…It’s taken a surprisingly long time to come around to the realization that older adults are also different.” This work is emblematic of a larger movement to consider the final third of a person’s lifespan, beginning in the late 50s, as a separate stage of life. This phase of “elderhood” should be worthy of the same study and attention as childhood and adulthood. Researchers are both promoting a new view of aging and activity and urging a need to rethink standard medical guidance for older patients, challenging whether research, largely conducted on younger adults, and the resulting clinical guidelines, can be directly applied to the elderly. This work is worth watching as it could be foundational to reshaping healthcare in a way that both lowers costs and centers outcomes around the goals of demanding Baby Boomers—who are just beginning to enter their elderhood years.
The future of healthcare according to a “radical capitalist”
We’re not aficionados of the business memoir genre, but we might have to pick up a copy of Mark Bertolini’s book after reading a fascinating excerpt in Chief Executive this week. The former Aetna CEO’s book is entitled Mission-Driven Leadership: My Journey as a Radical Capitalist, and in it he shares his vision for the future of healthcare and his rationale for selling the insurance company to pharmacy giant CVS. Frustrated with a healthcare system built around payer and provider priorities, Bertolini asks us to imagine a system oriented around the needs of the individual. “Based on your current health and your long-term goals, let’s design a set of benefits and a way to pay for them that would take care of you for life,” he envisions the health plan executive of the future saying to a customer. The discussions leading up to the sale of Aetna to CVS were framed around just that vision—one that the company now seems to be rapidly implementing in the rollout of its new HealthHUB stores. Bertolini hopes for radical changes in how care is delivered in those new, more consumer-oriented settings. For example: “The new stores will expand [beyond MinuteClinic services] and also offer procedures or exams that have long been done in hospitals…[W]hen a woman receives a mammogram, her doctor sometimes orders a CT scan. But the patient may have to wait two weeks, as the CT scan operators are only available from eight to five. The CVS stores could have a 24-hour CT scan available.” To achieve his vision, Bertolini was willing to trade off the independence of Aetna as a company, and his own position as CEO, paving the way for what may prove to be one of the most significant realignments in the healthcare industry. Fascinating reading, from a fascinating leader.